This story appeared in Bank Digest.
The Fed has released a report to Congress on credit ratings, pursuant to Sec. 939A of the Dodd-Frank Act. The Act requires each federal agency to review its regulations and identify any regulation that requires the use of an assessment of the creditworthiness of a security or money market instrument and any references to or requirements in such regulations regarding credit ratings. Each agency must then issue a report to Congress and modify the regulations identified in the review by removing all references to or requirements of reliance on credit ratings and substituting alternative standards of creditworthiness. The Fed stated that it anticipates that it will propose amendments to remove references to credit ratings from its capital requirements in conjunction with other expected changes to those requirements, including the implementation of recent international agreements on capital through the Basel Committee on Banking Supervision.